How To Create The Right Niche for Your Business?
Stop getting overwhelmed thinking if your niche is too wide or too narrow. Get your answer once and for all
This is the 124th consecutive post on MrEmogical Notes. If you’ve been following this series and are finding value from this blog/ newsletter, please consider sharing this post with one person who you feel needs to read this for their betterment.
Introduction
Every blog post, YouTube video, podcast episode on business keeps talking about the subject of niche.
However, nobody cares to explain how to determine if the niche you’ve chosen for your business is too wide or is it too narrow.
Time to solve this dilemma once and for all.
The simplest way to get clarity on your niche is dependent on a perfect synch between the following 3 factors
01 - The problem
What problem does your business solve? Has the problem existed for the last 10 years, at least? Do you see the problem continuing to exist for the next 20 years, at least?
If the answer to both the questions is yes, you’re good to go to the next question.
However, please note one simple thing. Business has and shall always be/ remain dynamic in nature. That’s a feature/ characteristic of the business, not a bug.
Accordingly, even if you believe that the problem that your business solves shall continue to exist 2 decades down the road, brace yourself for some shift in the overall environment every 3-5 years.
02 - The size of the market
The answer to this question depends on the nature of your business.
If you’re running a local retail store with products of low selling price (under $100), consider starting a business in a locality with access to 100000 people at a 15 mins walking distance.
If your product is of medium value (under $5000), make sure you’re operating in a suburb/ locality of a city or in a town with population of at least 250000 people (ideally 500000 people)
If your product is of high value (over $5000), make sure you’re operating in a suburb/ locality of a city or in a town with a population of at least 1 million people.
03 - The target audience
The target audience of your business/ brand should be at least 10% people from the overall size of the market.
What if the business is online?
If your business is online, make sure you select a cohort of target audience that consists of at least a million people in the areas where your product will be delivered.
In case of a digital product, select a cohort of at least 1 million people who would benefit from purchasing your digital product/ service.
What happens in case of a service-based business?
In case of a bespoke service (read: agencies), you need to have a client-team ratio. A team of 3-5 people can easily cater to 10 clients depending on the nature of your services. An agency should operate in a market where there are at least 10,000 profitable and growing businesses that would need the services of your agencies.
Conclusion
Finding the right balance between the product, the overall market and your target audience is the way to understand the true efficacy of your niche.
If the numbers don’t add up/ align for your business, you need to get back to the drawing board.
If the overall audience your business is catering to is higher than the numbers suggested in this post, there’s a good chance you’d do better business if you tighten your target market and revisit your messaging/ marketing strategy.
Your Thoughts!
If you feel you’re absolutely lost or if you feel you need more clarity with your niche/ positioning/ your personal brand/ your content strategy and would like to consult with me for the same, feel free to reach out to me and let’s connect.If you’ve reached till this point of the post, I’m sure you must have some thoughts/ feelings/ opinions about what you’ve just read.
I’m done sharing what’s on my mind, and now is your turn to share your POV.
Tell me how you are processing the information that you’ve just read?
Do you agree with my thoughts?
Do you think I missed something important?
Do you disagree with something in particular?
Let’s continue this conversation (or ask your questions about the post) in the comments below.
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Prompt used to create the image for the note
P.S.: Image made on Meta AI using the prompt, “Imagine a business owner in a stall in an exhibition”